Bramwell's Lunch Beat: SEC Judges, Cadillac Tax Repeal Bill, Deloitte Sued
SEC gives ground on judges
The US Securities and Exchange Commission (SEC) said on Thursday it will overhaul its in-house tribunal following months of escalating legal challenges and criticism of its increased use of its own judges, wrote Jean Eaglesham of the Wall Street Journal. The new rules, approved by a vote of the five commissioners who run the SEC, would give defendants in cases sent by the agency to its own judges more of the legal protections offered in federal court. Among the proposed changes, defendants will be allowed to get sworn testimony from witnesses or others ahead of trial â a right, granted in federal court, that defense lawyers say is a crucial weapon in fighting a complicated case. The new rules don't resolve the legal argument at the heart of several continuing lawsuits against the SEC. Two federal judges have said the SEC's existing system for appointing judges is âlikely unconstitutionalâ â findings the SEC rejects and is appealing.
Sanders, top Dems urge repeal of âCadillac tax'
Sen. Bernie Sanders (I-VT) and seven Democratic senators introduced a bill on Thursday to repeal Obamacare's so-called âCadillac taxâ on high-cost healthcare plans, wrote Sarah Ferris of The Hill. The bill's Democratic co-sponsors include such heavyweights as Sen. Charles Schumer (D-NY), who is in line to become the chamber's top Democrat, as well as Sen. Patrick Leahy (D-VT), the chamber's longest-serving member, and Sen. Chris Murphy (D-CT), who leads the Senate's âAffordable Care Act Worksâ campaign. The Democrats' repeal push puts them in direct odds with President Obama, who has refused to budge on the much-maligned tax. The move also puts pressure on Sanders' presidential rival Hillary Clinton to declare her position on the tax. She has previously said she is âexaminingâ the provision but did not make any mention of the tax during a series of speeches this week focused on her healthcare platform.
Deloitte sued for $500 million by estate of ex-Pistons owner
Chris Dolmetsch of Bloomberg wrote that a Deloitte LLP unit allegedly promised a tax plan under which former Detroit Pistons owner Bill Davidson would âwin if he lived, or win if he died.â But it didn't work out that way. Four years after the 2009 death of the multibillionaire, his estate was hit with a $2.7 billion tax bill, according to a lawsuit filed in New York. The estate sued Deloitte Tax LLP on Thursday to recover $500 million in taxes, fees, and penalties from the advisor. The lawsuit says Deloitte Tax failed to disclose the risks of the tax plan that it recommended to Davidson in order to secure him as one of its âmarquee clientsâ who could generate large fees and serve as a âshowpieceâ to promote its services to other wealthy people. In a statement, Deloitte Tax said: âWe are deeply committed to our clients and stand fully behind the services our team provided to Mr. Davidson. We regret that the estate executor has decided to pursue this path.â
Study: Pass-through businesses encourage income inequality
Businesses that pay taxes through the individual system â so-called pass-throughs â are fueling the rise in income inequality, according to a new study authored in part by Treasury economists, wrote Bernie Becker of The Hill. That's because pass-throughs, which include both small businesses and large law firms, don't pay as much in taxes as corporations. In fact, the top 1 percent saw their share of income double between 1980 and 2013, with over half of that jump driven by pass-through income. Pass-throughs, which include S corporations and partnerships, paid an average rate of 19 percent in 2011. The tax rates for partnerships was even lower on average, at 15.9 percent. Corporations, on the other hand, paid close to 32 percent on average. In addition, pass-through income and participation was highly concentrated within the top 1 percent â with the wealthiest earning roughly seven of every 10 dollars from pass-throughs.
- Dewey jurors seek clarity on âfalse' accounting moves (New York Law Journal)
- If corporate profits are up then why are corporate tax revenues down? (Forbes)
- Maine Republicans double down on tax cut fervor (Tax Justice Blog)
- The trouble with state tax triggers (TaxVox)
- Sometimes, tax policy is also foreign policy (Tax Foundation)
- Cadillac tax working as planned on auto workers (Tax Foundation)
- Does your state levy a capital stock tax? (Tax Foundation)
- US taxpayers duped into shelling out $51 million in green subsidies for âclean' VW vehicles (Los Angeles Times)
- New Jersey Senate passes Chris Christie plan to slash sales tax on yachts (Associated Press)
- NDP plan to boost tax on stock options seen stunting Canada tech (Bloomberg)